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As the Republican tax bill lurches toward enactment, many of its major features remain in flux. We still do not know the future corporate tax rate, the extent of tax relief for partnerships and other pass-through entities, the details of the international tax changes, and so on. But, as I wrote in “A Tale of Two Tax Plans” (July/August 2017), the central tension underlying the tax overhaul has been apparent for some time. That tension is between the reform’s clear immediate effects and its speculative long-term consequences.

First, consider tax revenue. The reform’s immediate effect is a large loss in revenue that experts believe will increase the national debt by about $1.4 trillion over the next decade. Without legislative gimmicks such as the sunset of individual tax cuts in 2026 (something no one in Washington expects to happen), the revenue cost is over $2 trillion. In theory, future economic growth will reduce the revenue losses. The Joint Committee on Taxation—the official congressional scorekeeper—just announced that the growth-induced revenue would be about $400 billion. This is not nearly enough to prevent the deficit from ballooning to almost 100 percent of GDP in about a decade. Most other dynamic long-term forecasts project even lower revenue from growth. But Republicans argue that the boost to the economy will be so dramatic that the reform will pay for itself.

Yet all of these forecasts may be too optimistic. The United States is in the midst of one of the longest economic expansions in its history (anemic as that expansion happens to be). It is almost certain that the country will experience a recession in the next ten years, and probably much sooner. Recessions do not help economic growth. Moreover, the last time that the United States cut its corporate rate dramatically other countries followed suit. It is quite possible that they might do so again. If they do, the anticipated competitive advantage built into the reform’s growth